Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Second State Legislature

Regular Session of 2003

State of Hawaii

Sir:

Your Committee on Water, Land Use, and Hawaiian Affairs, to which was referred H.B. No. 1589 entitled:

begs leave to report as follows:

The purpose of this bill is to authorize the issuance of general obligation bonds to fund capital improvement projects for improvements to the State's boating facilities.

The Ocean Tourism Coalition supported this bill. The Department of Land and Natural Resources (DLNR) opposed the measure.

Your Committee finds that facility user fees and lease rents provide 80 percent of the revenues deposited into the Boating Special Fund, with the remaining revenues coming from the state marine fuel tax (12 percent) and reimbursement from federal matching grants (8 percent).

Over the years, legislative initiatives have significantly increased the scope of the statewide boating program to include management of a broad range of ocean recreational activities from which no additional revenue is generated. No general funds have ever been appropriated to help pay for the increased operating costs. Lack of funding to address needed maintenance projects has resulted in many facilities falling into advanced states of disrepair--even to the point where certain boat slips had to be taken out of service for safety reasons.

Increasing mooring and other facility user fees are the only ways DLNR can raise revenue through administrative rulemaking. However, no fee increases have been implemented since February 1995 for a variety of reasons. The proposed fee increases that were the subject of statewide public hearings in October 2002 met with nearly unanimous disapproval.

Your Committee notes, moreover, that the Legislative Auditor recommended that the boating program should seek general fund appropriations to address the critical backlog in repair and maintenance projects (Report No. 01-09, April 2001).

Furthermore, your Committee requests that DLNR prioritize all of its pending projects in anticipation of using special revenue funds as proposed in H.B. No. 579, H.D. 1, which is also before this Committee.

As affirmed by the record of votes of the members of your Committee on Water, Land Use, and Hawaiian Affairs that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1589 and recommends that it pass Second Reading and be referred to the Committee on Finance.